AA Chapter 26 Questions
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Losing the material amount owed by the customer, can it be disclosed?, as it can impact the economic deceision of stakeholders.
Per IAS 1 “An item that is not sufficiently material to warrant separate presentation in those statements may warrant separate presentation in the notes.” So it is possible that a credit loss (“bad debt” expense) merits separate disclosure in the notes to the SoPL (but that doesn’t mean to say that the customer(s) will be named). PLEASE remember to ask questions on the ask the tutor forum rather than here.
Generally yes – the notes to the financial statements would be very long indeed if it was a requirement to explain every transaction/event that has been recognised in the financial statements. So if something is adjusted for – that’s it – it has been dealt with. It is because a non-adjusting event has NOT been “dealt with” (i.e. recognised) that it requires disclosure.
In Q2 can we say all adjusting event requires only adjustment in the FS and no note to the FS to explian the matter.